Over the past few years, the US government has tried to tighten its grip on different sectors of the crypto industry. As a result, these efforts have received significant pushback from politicians and central figures in the crypto space.
This week saw another crackdown on the crypto industry after Arkansas lawmakers passed two bills to address criticism of past regulations on mining operations.
New Crypto Mining Regulations in Arkansas
News media The Associated Press (AP) reported on Wednesday that Arkansas’ House of Representatives gave final approval to two bills related to crypto-mining operations in the state.
The two Senate-backed bills, SB78 and SB79, were among the few non-budget items on the legislative session’s agenda and were “overwhelmingly approved” by the majority Republican House. They are headed to Republican Gov. Sarah Huckabee Sanders’ desk.
Last year, Arkansas lawmakers faced backlash after passing the Arkansas Data Centers Act of 2023. The approved Act 851 established an overall favorable regulatory foundation for crypto miners in the state and established clear definitions and guidelines.
As Bitcoinist reported, the law included provisions prohibiting discrimination against digital asset miners. Additionally, it sought to protect crypto-miners from “discriminatory regulations” and ensure their equal treatment as data centers.
Law 851 has been criticized because it limits the local government’s ability to introduce measures to regulate mining enterprises. Now Arkansas’ Senate and House of Representatives plan to address the complaints of last year’s law with newly approved bills.
These bills face backlash from local officials and residents living near the operations, who have complained about the noise impact on the community. As a result, lawmakers added the requirement for noise reduction techniques and a state permit to operate.
In addition, the two bills addressed water use restrictions for cooling techniques and removed the restriction to regulate the sound decibels generated by mining facilities. Republican Representative Rick McClure said:
Let’s do what we can to help those affected in a negative way and work for better solutions.
Additionally, the approved bills prohibit the ownership of crypto-mining businesses by companies and individuals from various countries, including China.
Nevertheless, it continues to limit the regulatory power of local authorities on matters such as home mining of individuals or rezoning of areas where crypto mining enterprises are located.
Gov. Sanders to sign the bills despite concerns
According to AP, one of the representatives who voted against the bills, Democrat Andrew Collins, expressed concern about the wording of the cap and the impact it could have on foreign investment:
We cast a net that is too wide and too narrow. It’s going to catch people who are completely innocent, and it’s going to miss a lot of people who are either homegrown or come from countries not on this list.
Representative Justin Gonzalez also voted against the bills. He expressed his opinion on the matter during an interview on Wednesday. For the representative, the bills would “allow local governments to discriminate against a business just because of what it is.”
The Arkansas Advocate reports Gonzales doesn’t believe the law needs to be amended, even though he didn’t have a problem with the language used to address the foreign ownership issue.
Regardless of the concerns of the opposition, the bills are expected to be approved by the Governor of Arkansas. Alexa Henning, Sanders’ spokeswoman, said in an email that both bills would be signed, and went on to claim, adding that:
The governor was the first in the country to kick a communist-owned Chinese company out of her state and strongly supports banning foreign rivals from owning crypto mines in Arkansas, while protecting rural communities and empowering them to take on bad actors to hit
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